Harvey Nursery will close at the end of this academic year, following recommendations from a committee which included parents and independent experts.
The final decision was made at a Bolton Council Executive Cabinet Member meeting earlier today and remaining families will now be supported to move to alternative providers.
The local-authority-run nursery costs council tax payers in excess of £100,000 a year and was projected to operate at just 25% capacity by September.
The Harvey Nursery Collaborative Management Committee was established in March to review the current business model and consider any options to make the service financially viable.
It included experts from across early education, parents of children at Harvey Nursery and representatives of Bolton Council.
The group found that, even at full capacity, there was no sustainable business model that would allow the facility to break even.
Contributing factors include a lack of demand in the area, with the number of childcare vacancies at local private early year providers far outweighing the number of parents requesting places.
The committee concluded that the nursery could not make up for the financial shortfall by charging more, as this would result in fees far higher than the regional average.
It determined that a private business operating under these conditions would not be able to carry on trading.
However, the group made clear that the financial viability of Harvey Nursery in no way reflects the quality of provision, which has been rated Good by Ofsted.
Several members of staff have already found alternative employment while the parents of 25 children will be helped to find new childcare places.
The closure of Harvey Nursery was first proposed in September 2017.
A new business model was adopted in July 2019 which was based on reaching 75% occupancy in order to break even.
Between 2019 and 2021 the maximum nursery occupancy was 52%.
Bolton Council’s Executive Cabinet Member for Children’s Services, Cllr Anne Galloway, said:
“Today’s decision was not taken lightly, and I would like to thank the Harvey Nursery Collaborative Management Committee for exploring all the options.
“The financial viability of the nursery has presented a challenge to both this and the previous administration, but it has not been possible to find a sustainable solution.
“This in no way reflects the quality of childcare provision at Harvey Nursery or the hard work and dedication of staff.
“These savings will allow us to continue providing other valuable services for children and young people across the borough.
“Families will now be supported to access other provision in the area.”
Carolyn Hutton, owner of Canterbury Private Day Nursery and the independent chair of the Harvey Nursery Collaborative Management Committee, said:
“It is a challenging time for childcare providers with a change in the levels of demand and rising costs.
“The committee looked at a number of options for Harvey Nursery but unfortunately it was not possible to find a sustainable business model.”